Co-ops vs condos: what Brits need to know before buying a flat in New York

Most flats for sale in Manhattan are co-ops, where you buy shares rather than bricks and mortar, and a board of residents can turn you down without saying why.

The short version

• A co-op is a company that owns the building; you buy shares and get a proprietary lease. A condo is closer to a UK leasehold flat, except you own the unit outright with a share of the common parts.
• Co-op boards vet buyers in detail and can reject you. Newcomers with little US credit history, foreign income or plans to rent the flat out often find condos easier.
• New York State charges buyers a 1% mansion tax on homes of US$1 million or more, including co-ops and condos [1][2].
• New York City's own transfer tax is 1% up to US$500,000 and 1.425% above that, usually part of the seller's costs [3].
• Back home, owning a New York flat counts as owning a property for the UK's higher stamp duty rates [5].

Co-op or condo: the basic difference

Back home in Blighty, buying a flat usually means a long lease, a freeholder and a service charge. New York has two main models, and they work very differently.

Co-ops dominate the older stock in Manhattan and much of Brooklyn and Queens. Many Brits fall for a pre-war co-op on the Upper West Side, then meet the board.

How co-op boards work

The board is a group of elected residents. When you agree a price, you submit a board package, which can run to a hefty folder: tax returns, bank and investment statements, employer letters, reference letters (often personal and professional), and sometimes a landlord reference. Then comes the interview, which is less "Dragons' Den" than people fear, but you should dress smartly and keep it short.

Boards look at:

• Debt-to-income ratio: they want your monthly housing costs and other debts to sit comfortably within your income.
• Post-closing liquidity: many want you to have a year or two of maintenance and mortgage payments left in cash after you've paid for the flat. The exact rule varies by building.
• Deposit: many co-ops want 20% or more down; some prestigious buildings want far more, or cash.
• Use: many co-ops dislike pieds-à-terre, buyers who plan to sublet, or purchases through companies or trusts.

A board can reject you without giving a reason, as long as it isn't discriminating against a protected group. For a newcomer, the sticking points are usually a thin US credit file, income paid in pounds or from a UK employer, savings held mainly in the UK, or a visa with an end date. None of these is an automatic no, but each one is a question you'll want an answer ready for. Our guide to building US credit from scratch helps with the first.

Why many Brits buy condos

Condos are usually easier for newcomers:

• There's no board interview, only a building right of first refusal that's rarely used.
• Lenders, not neighbours, decide on your finance.
• You can usually rent the flat out if you're posted back to London.
• If you buy as a foreign national, or through a structure your adviser recommends, condos are generally more accommodating.

The trade-off is price. A condo usually costs more than a similar co-op, and you pay your own property tax on top of common charges. Some newer buildings have tax abatements that end after a set number of years, so check what the bill will be once they run out.

Closing costs and the taxes on top

US closing is handled by lawyers on both sides; in New York, buyers almost always use a real estate attorney, roughly the equivalent of a conveyancing solicitor. Here are the main taxes and costs.

Taxes

Sources: NYS Department of Taxation and Finance [1][2] and NYC Department of Finance [3][6]; the combined state and city mortgage recording rate depends on the size of the loan. Co-op share loans aren't recorded mortgages, so co-op buyers skip the mortgage recording tax, which is one point in the co-op column.

For scale, the mansion tax on a US$1.2 million flat is US$12,000 (about £8,900). US$1 million is about £742,000. Pound conversions use the Bank of England spot rate of 5 November 2026 (£1 = USD 1.3476). On newly built condos sold by the developer, buyers are often asked to pay the seller's transfer taxes too, so read the offering plan carefully.

Other costs to budget for

• Buyer's attorney fees, agreed up front.
• Lender and title costs for condos (title insurance replaces the UK land registry checks).
• Co-op fees: board application fees, a lien search and sometimes a "move-in" deposit.
• Flip tax: some co-ops charge one on resale, usually paid by the seller.

Overall, buyers' closing costs are usually a few per cent of the price, and more on a condo with a mortgage and new-build seller costs passed on.

Mortgages for newcomers

Getting a US mortgage without a US credit history is possible but harder:

1. Expect a bigger deposit. Lenders often ask for more from people with short US credit records or on temporary visas, and co-op boards may want more still.
2. Talk to your own bank. Some banks with UK and US arms, and private banks, lend to clients based on their wider relationship. Your employer's relocation team may know which lenders have helped colleagues.
3. Show stable US income. A US salary and a few payslips help a lot. UK income is harder to use and can raise exchange-rate questions.
4. Think about currency. A dollar mortgage on dollar income is simple; a dollar mortgage repaid from sterling earnings carries currency risk.
5. Get pre-approved before you bid, especially for a co-op, where a mortgage commitment goes into the board package.

The UK side: stamp duty, your UK home and tax

A few British angles catch people out:

• Stamp duty if you buy back home. For SDLT's higher rates, what counts is whether you own residential property worth £40,000 or more "anywhere in the world" [5]. Own a Brooklyn condo and buy a flat in Bristol, and you'll usually pay the 5% surcharge. Buying as a non-UK resident can add the separate 2% surcharge in England and Northern Ireland [4].
• Keeping your UK home. If you rent it out, the Non-Resident Landlord Scheme applies, and the US taxes the rent too.
• Selling later. US capital gains rules and UK rules can treat the same sale differently, especially if you move back. A tax adviser who knows both countries can check your case before you sell.
• Selling while foreign. Sellers who aren't US tax residents usually face withholding under FIRPTA, a federal rule that holds back part of the price at closing. Most working Brits in New York are US tax residents and avoid it, but check before you go back home.

Our guide to buying property in New York vs the UK compares the two systems step by step. Before you sign anything, it's worth asking other Brits which buildings and boards were friendly to newcomers; our community group for Brits in the US is a good place to start.

Sources

1. NYS Department of Taxation and Finance: Publication 577, FAQs on the additional tax on transfers of residential real property (mansion tax)
2. NYS Department of Taxation and Finance: Real estate transfer tax
3. NYC Department of Finance: Real Property Transfer Tax (RPTT)
4. GOV.UK: Stamp Duty Land Tax – residential property rates
5. GOV.UK (HMRC): Stamp Duty Land Tax – buying an additional residential property
6. NYC Department of Finance: Mortgage Recording Tax

Keep reading

• Renting in New York
• Banking in the US as a Brit
• Buying property in New York vs the UK
• Keeping your UK home or selling it before you go